They are not mutually exclusive. If you are not investing for the long term, then you are not saving either. Longer term investing is the only way to ensure that inflationary forces will not erode the value of your savings. In terms of a strategy, that is dependent on the time frame. There should always be a short term cash equivalent emergency fund of at least 6 months - 1 year. The longer term investing should be done in the most tax efficient ways first such as a 401k/403b...etc. And then focus on a strategic asset allocation consistent with a risk level the corresponds to your personal goals. The current economic climate is irrelevant. The attempts to time market movements is an excercise in futility. The economy has been limping along with anemic growth rates for 5 years now. Yet US markets are approaching all time highs. In the year 2000 we had a projected budget surplus with projected robust GDP growth. What happened...The tech bubble burst and the market fell by nearly 40%. Financial markets and the economy are not siblings. They are more like cousins. They are related, but do not necessarily correlate in tandem.
The excessive debt is actually a long term potential positive for equity investments. It means the Central Banks will likely continue to devalue currencies to inflate away debt problems and will drive up asset prices. That tends to mean more volatility. And it is not a policy prescription I agree with. But it is the likely scenario we will see.